The Rupee closed at a record low on Friday, as a bout of portfolio outflows, uncertainty over a U.S.-India trade deal and a pullback in the central bank's defense of a key level sparked a slide in the local currency. The rupee fell to 89.49 against the U.S. dollar, sliding past its previous all-time low of 88.80 hit in late September and earlier this month. It was down 0.9% on the day, its biggest single-day decline since May. The South Asian currency has struggled for three months since steep U.S. tariffs on Indian exports took effect in late August, even as India's economic fundamentals remain resilient while equity markets are hovering near record highs. The tariffs though have impacted trade and portfolio flows, and pushed India’s merchandise trade deficit to a record high last month, with exports to the United States down 9% year-on-year. Foreign investors, meanwhile, have withdrawn $16.5 billion from Indian equities so far this year, making India one of the worst-hit countries in terms of foreign portfolio outflows. Traders said the Reserve Bank of India, which had actively defended the 88.80 level in recent sessions, appeared to have scaled back its defense and instead likely stepped in near 89.50 on Friday. The yen found some support on Friday as Japanese officials stepped up their verbal intervention to stem the currency's decline, while the dollar was on track for its biggest weekly rise in six weeks. The yen popped higher after Japanese Finance Minister Satsuki Katayama said intervention was a possibility to deal with excessively volatile and speculative moves, leaving traders on alert for signs of yen buying from Tokyo. The Japanese currency rose 0.4% to 156.82 per dollar, though it remained close to Thursday's 10-month trough of 157.90 and was still on track to lose 1.5% for the week. Much of the focus in currency markets this week has been on the yen, which has plumbed fresh lows as investors worry about the nation's worsening fiscal position brought about by Prime Minister Sanae Takaichi's lavish spending policies. The yen has fallen around 6% since Takaichi was elected leader of her party on October 4. Against the euro, the yen was pinned near its lowest since the introduction of the single currency, although the euro was last down 0.5% at 180.61 yen. The release of a delayed U.S. nonfarm payrolls report on Thursday painted a mixed picture of the country's labour market and did little to alter expectations about a Fed rate cut in December, as policymakers continue to navigate through an economic fog brought about by the U.S. government shutdown. New York Fed President John Williams on Friday said the central bank could still cut rates in the near term, prompting markets to add to bets for a rate cut next month. Traders are now pricing in about a 60% chance of the Fed easing next month, up from about 30% earlier in the day. The euro stood at $1.1517 and was on track for a weekly decline of 0.9%. Oil prices fell on Friday, extending declines for a third session as the United States pushed for a Russia-Ukraine peace deal that could swell global supply while uncertainty over interest rates curbed investors' risk appetite. Brent crude futures dropped by 40 cents, or 0.6%, to $62.98 a barrel by 1300 GMT. U.S. West Texas Intermediate crude was down 0.9%, or 50 cents, at $58.50.......